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This article was first published in the Financial Times of January 1, 1973.

None of us will notice anything different to-day. No one, indeed, can at this stage predict just how, where and when the first major impact of British membership of the Community will be felt. And yet there can be no doubt that to-day represents a major landmark not merely in Britain’s but also in Europe’s history. It marks the culmination of a development which historical logic has dictated ever since the end of the Second World War.

It has become fashionable to talk of British entry as both an opportunity and a challenge. Many who use these phrases think mainly of the opportunities for British exports and the challenge of greater competition in the domestic market. British industry will certainly have to learn to live in the new Europe. This is a precondition if Britain is to play her full part in tackling the new problems which lie ahead. But this is one instance when a slogan in fact expresses a much more fundamental truth.

Domestic problems

The enlargement of the Community will not by itself resolve any of the problems which either Britain or the enlarged Community as a whole face. This country alone will have to deal with the single most pressing domestic issue, how to get inflation under control without impairing the prospects for more sustained economic growth than we have seen for at least two decades. The Community will not suddenly find itself imbued with a new European spirit which will make national differences disappear overnight.

What is true though is that only the enlarged Community can hope to deal with a whole range of issues which are of paramount importance to it and to every single member state. First and foremost among them is the redefinition of the trading and monetary relationships between the major industrialised countries. The old order had become increasingly fragile before it was finally destroyed by President Nixon's economic package in August, 1971. The cracks have been plastered over for the time being. But the relative diminution in the economic power of the U.S. and the growing strength of Europe and especially of Japan will have to be reflected in a more permanent settlement if the danger of a trade war is to be averted.

At least as difficult will be the formulation of common policies in a number of areas where specific domestic interests are even more directly involved than in the trade and monetary negotiations. The enlarged Community will have to make up its collective mind on the extent to which it wishes to compete with the super-powers in the technologically advanced industries. Whether it be aircraft, computers, or the nuclear energy field, no single European country can hope to mobilise the resources necessary to keep up with the U.S. The Community as a whole can, provided that the effort is properly organised.

The super-companies

The Community will not only have to compete with the super-powers, it will also have to deal with the super-company, the international giants which are bound to account for a steadily rising proportion of output. Here again a co-ordinated approach is essential if Government is not to be played off against Government. Common policies will also have to be devised to ensure that trade with the Communist world is further developed and that the Community provides both the aid and the trade openings which the developing countries need. It is easy enough to catalogue the tasks, less easy to suggest at this point in time the type of political institutions which will enable the Community to fulfil them. We must be wary of the constitutional theorists for the chances are that they will hark back to established models. Should the Community eventually become a federal structure or a confederation? The question is in itself wrong, because whatever may emerge in time, it will be something new. It will have to be, for national fears, prejudices, interests and aspirations cannot be simply suppressed overnight. It is only if all the member states recognise that there are certain things which they can only do in common and that these things are worthwhile that we can hope to see progress towards a more closely integrated Community, institutionally equipped to take on one day much greater responsibility also in the area of ultimate sovereignty, that of defence. We are in fact engaged in a race against time; the tasks will not wait, but a Community able to deal with them still has to be created. There are no short cuts here and no back doors. The men who thought that by devising a common. agricultural policy they would automatically create a monetary union learned that lesson.

The monetary sphere

The Community has set itself an ambitious timetable in the monetary sphere. Monetary union by the end of the decade is the cry. But monetary union not merely implies a Community Federal Reserve system but also reserves held in common. A common monetary policy must be accompanied by a common fiscal policy, a Community Budget which is an instrument of demand management. Monetary union also demands—and here the British Government is quite right in pushing the point—a Community wide regional policy.

If such a policy is to be based on the idea that British taxpayers should help Sicily, or German taxpayers assist Scotland and Wales it is not going to get very far. It is only if we regard the rich and industrialised parts of the Community—stretching in a belt from central Italy through the Rhineland, the Low Countries and Northern France to South-East England and the Midlands —as a whole that we shall begin to be able to frame regional policies which will be effective in helping all the areas of the Community which need help.

To set out the problems is enough to show how difficult they will be to resolve. This is not, however, to strike a note of despair. The basic truth is that if Europe is to survive and prosper in to-day's world it will have to act with much greater unity of purpose than it has in the past. Without the enlargement of the Community there was no chance that it might do so. The accession of the U.K. and the other new members at least makes it possible that the Community will be able to tackle the tasks facing Europe. It is in this sense that we can speak of the challenge and opportunities ahead.